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SEC
10-Q
BIOTELEMETRY, INC. filed this Form 10-Q on 10/31/2018
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BIOTELEMETRY, INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (continued)
(Unaudited)


 
Three Months Ended September 30, 2017
(reclassified, in thousands)
Healthcare
 
Research
 
Corporate
and Other
 
Consolidated
Revenues
$
69,528

 
$
9,313

 
$
2,182

 
$
81,023

Gross profit
45,035

 
3,732

 
302

 
49,069

Income/(loss) before income taxes
14,985

 
219

 
(18,203
)
 
(2,999
)
Depreciation and amortization
7,337

 
1,040

 
642

 
9,019

Capital expenditures
4,796

 
608

 
339

 
5,743

 
Nine Months Ended September 30, 2018
(in thousands)
Healthcare
 
Research
 
Corporate
and Other
 
Consolidated
Revenues
$
251,470

 
$
37,254

 
$
7,145

 
$
295,869

Gross profit
169,891

 
16,184

 
465

 
186,540

Income/(loss) before income taxes
81,261

 
4,257

 
(56,960
)
 
28,558

Depreciation and amortization
24,797

 
2,921

 
2,513

 
30,231

Capital expenditures
14,906

 
1,674

 
918

 
17,498

 
Nine Months Ended September 30, 2017
(reclassified, in thousands)
Healthcare
 
Research
 
Corporate
and Other
 
Consolidated
Revenues
$
156,109

 
$
28,199

 
$
10,725

 
$
195,033

Gross profit
102,593

 
11,466

 
3,886

 
117,945

Income/(loss) before income taxes
43,531

 
922

 
(45,126
)
 
(673
)
Depreciation and amortization
12,904

 
3,112

 
543

 
16,559

Capital expenditures
10,399

 
1,074

 
467

 
11,940


15. Legal Proceedings
The final outcome of any current or future litigation or governmental or internal investigations cannot be accurately predicted, nor can we predict any resulting penalties, fines or other sanctions that may be imposed at the discretion of federal or state regulatory authorities. We record accruals for such contingencies to the extent that we conclude it is probable that a liability has been incurred and the amount of the loss can be estimated.
ZTech, Inc., Biorita LLC, and the Cleveland Clinic Foundation Arbitration
In January 2017, ZTech, Inc., Biorita LLC, and the Cleveland Clinic Foundation (the “Claimants”) filed an arbitration demand against LifeWatch with the American Arbitration Association. Claimants alleged that LifeWatch violated the 2015 Stock Purchase Agreement for the purchase of FlexLife Health, Inc., a remote international normalized ratio monitoring business. The demand alleged LifeWatch did not make commercially reasonable efforts to achieve certain conditions precedent and did not have a reasonable basis for terminating the business line. Claimants sought liquidated damages and attorneys’ fees. On May 9, 2018, the arbitration panel issued an award including accrued interest against LifeWatch in the amount of $6.0 million. The award liability, plus the accrued interest through July 12, 2017, was recorded as a measurement period adjustment related to our LifeWatch acquisition (see “Note 3. Acquisitions”). The

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